Economics • Economic BasicsMedium
What primary macroeconomic challenge does a landlocked Himalayan economy like Sikkim face regarding import-dependent consumer goods and construction materials?
A. Excessive maritime freight subsidies
B. High vulnerability to supply chain disruptions and imported inflation✓ Correct Answer
C. Complete insulation from global commodity price fluctuations
D. Surplus export earnings from heavy manufacturing
💡 Solution & Explanation
As a landlocked hill state reliant on narrow mountain corridors for all external trade, Sikkim experiences heightened price volatility when transport routes face blockades due to landslides or weather events. Maritime subsidies do not apply to landlocked domestic regions. Inflationary pressures in such regions often stem from transportation markups on essential commodities.
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